Technical analysts use support and resistance levels to identify price points on a chart where the probabilities favor a pause, or reversal, of a prevailing trend. Support occurs where a downtrend is expected to pause, due to a concentration of demand. Resistance occurs where an uptrend is expected to pause temporarily, due to a concentration of supply. The article "Interpreting Support and Resistance Zones" examines the basics of this technical analysis tool. This story will examine how support and resistance zones are largely shaped by human emotion and psychology. (Every time an investor talks about getting in low or picking entry and exit points, they are paying homage to these men. Shifting Zones Support and resistance zones are not only seen at particular prices; they can exist along with up or down trendlines. Figure 2, which shows a two-year daily chart of Johnson & Johnson (NYSE:JNJ), illustrates how these zones can appear as horizontal lines (the support in this example) or with prices that occur along a trendline (the resistance level in the chart). Time and again, over the course of two years, these levels were tested, breaking significantly above or below the trendlines only twice. (We'll show you which candles shed light on successful trend trades. Check out Inside Day Bollinger Band® Turn Trade.) Human Emotions and Behavior Fear and greed, for example, are seen in the market participants' behavior outlined above. As price falls back to a support level, the traders who are already long will add to positions to make more money. Meanwhile, the traders who are short will buy to cover, because they are afraid of losing money. Be guided, sucess.